Valhalla Business Solutions - Business Management Consultants

Sales Management Consulting Specializing In... Sales and service Systems, Managing younger generations, Management protocols Coaching effectiveness

Friday, May 1, 2009

Marketing Needs-Measure your Results

How much do you spend?
How much do you make?
Implement profiling

It is as simple as this. Often when we enter an organization and we analyze their marketing budget, there is no correlation between how much they spend on marketing and how much revenue it produces.

Recently I entered a company who was spending money in every magazine, lead list, direct mail campaign out there. When I asked them how much business they were receiving from these adds, they couldn't answer my question. First make it apart of your profiling process to ask what brought your customer to you. It may seem simple, but track the answers. Then track how much the traffic source spends.

For example a direct mail campaign...

You send 10,000 pieces and it costs you $6,000.

Measure how many people came in from your campaign. Lets say 30 people came in from your mail campaign and they averaged spending $300.00. Would that be worth your time and money? The answer is yes. You made a $3000.00 profit. Now if you average $30 per customer that comes in, was it worth your time? The answer is no.

Although this is simple math, many companies don't measure it that way. Now there are variables that cannot be accounted for nor should be factored into this equation. How much referral business you obtain from the 30 people who did come in. You can't measure this very effectively, we suggest you use the simple formula above.

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